Tuesday, 21st February 2017
Originally published on The Frontier Investor
January came out swinging with major international political upheaval, but that doesn't mean you should forget your wealth creation goals. No matter what's happened overseas or at home, your aim of creating independent wealth is very much still possible through residential property investment.
The best time to get into property is always now - the longer you hold property, you're most likely to get the full benefit of capital growth and cashflow. We've put together a selection of our best tips for getting into Australian property in 2017 to ensure you're on the right step towards financial freedom.
Know your numbers
Engage a professional to do the property search
Property investment is not a DIY situation. Finding the right investment takes thorough research in terms of what suits your financial goals, budget and timeframe. You need to talk to a residential specialist such as myself to make sure the property ticks all the right boxes. We also enjoy access to off-market property, that is, dwellings that are not listed on the major real estate websites.
Be aware of changing interest rates
It's more than likely interest rates will start to rise in 2017, but this shouldn't be cause for concern. Yes, investors will pay more but they need to look at what tax bracket they're in and speak to their accountant to really see how the numbers stack up. Interest rates for investors last rose like this in the early 1990s and it's part of the cycle. This is one of the things a cash buffer will protect you from - be prepared and you won't be disappointed.
Consider future expenses
While we never exactly know what's around the corner, with some foresight we can be prepared to meet future expenses including school fees, a new car or travel plans. Be honest with yourself about what you want to do with your money as time goes on and you'll be able to strike a balance between lifestyle and investing.
Always use the sleep test
No matter what you're advised, put everything to the sleep test! You'll soon know whether something is too good to be true. It's a technique that's never let me down - I wait three days and nights and if I can't sleep, I know whatever I've been told is not for me.